Coherent Corp. reported its third‑quarter fiscal 2025 results, posting revenue of $1.50 billion—a 24% year‑over‑year increase from $1.209 billion in Q3 FY2024. The growth was driven by robust demand in the data‑center and communications markets, where the company’s optical networking solutions continue to capture market share amid the expansion of AI‑driven workloads.
GAAP gross margin rose to 35.2% from 30.3% in the same quarter a year earlier, while non‑GAAP gross margin improved to 38.5% from 38.2% in Q3 FY2024. The margin expansion reflects a favorable product mix shift toward higher‑margin networking equipment and disciplined cost management, offsetting modest increases in raw‑material and labor expenses.
On a GAAP basis the company recorded a net loss of $0.11 per diluted share, an improvement from the $0.29 loss reported in Q3 FY2024. Non‑GAAP earnings per diluted share reached $0.91, a significant beat over the consensus estimate of $0.33 and a jump from the $0.38 reported a year earlier. The earnings beat is largely attributable to revenue growth, margin expansion, and the absence of one‑time charges that impacted prior periods.
Coherent also reduced its debt balance by $136 million during the quarter, strengthening its balance sheet and providing additional flexibility for future capital allocation. CFO Sherri Luther noted that “Revenue growth and gross margin expansion drove a significant year‑over‑year improvement in our GAAP and non‑GAAP EPS. We also paid down $136 million of our outstanding debt. Cash and capital allocation remain priorities for us, as we further improve operating leverage and efficiency, while continuing to make investments for the long‑term growth of the company.”
Management guided for Q4 FY2025 revenue of $1.425 billion to $1.575 billion, non‑GAAP gross margin of 37% to 39%, and non‑GAAP EPS of $0.81 to $1.01. The guidance signals confidence in sustained demand for AI‑related data‑center solutions and the continued success of new product launches, while maintaining a focus on margin improvement and debt reduction.
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